INTERVIEW: New Gourmet Master CEO plans to elevate 85°C brand

Gourmet Master Co, which owns bakery and coffee chain 85°C, last week announced that it had hired former President Chain Store Corp chief operating officer James Hsieh to be its chief executive officer. Hsieh yesterday met with journalists, including ‘Taipei Times’ staff reporter Amy Su, to share his vision for developing 85°C into a world-class brand

Wed, Jan 09, 2013 - Page 13

Taipei Times (TT): Gourmet Master Co (美食達人) underwent a year of expansion last year. Under your leadership, what will be the company’s major goal for this year?

James Hsieh (謝健南): Last year was definitely an important year for Gourmet Master, given that the company launched more than 100 85°C (85度C) outlets in China and created two new brands in Taiwan: a high-level bakery named Better Simple (麵包同話) and hot pot chain called Top One Pot (這一鍋).

Compared with last year, this year will be more like a period of adjustment for us as we endeavor to make the 85°C chain the No. 1 Taiwanese food-and-beverage brand.

I hope to spend the first half of the year evaluating the size and potential of every market Gourmet Master could enter, and also focus on expanding further in markets that are showing high potential, while dropping out of markets were we cannot develop further.

TT: What kind of qualities does the 85°C chain need to develop to become a world-class brand?

Hsieh: In my opinion, a world-class brand has to meet three criteria: it must well-known in at least 10 countries, own more than 2,000 outlets worldwide and enjoy popularity in interdisciplinary markets.

The 85°C chain has a great opportunity to become a globally renowned brand because of its simple product line, which makes outlets more easy to replicate and operate in markets around the world.

That is to say, the chain — which already has 737 outlets in Taiwan, China, Hong Kong, the US and Australia as of the end of last year — has to keep expanding into more countries and change its status from “a brand for the Chinese,” to “a brand for all.”

Therefore, I am aiming to see some positive results by the end of this year after confirming the development objective for each market in the following months and hope to establish a company model for sustainable growth in three years.

TT: Which market will be the core driver of the 85°C chain’s aim to become a global brand?

Hsieh: The US will be a key market, since revenue from the company’s three outlets in that country has been showing strong growth since their establishment.

Therefore, Gourmet Master plans to increase its 85°C outlets in the US to seven or eight this year.

In the long run, I hope that the coffee and bakery chain will be seen in major shopping malls across the US, which I think is a perfect venue for the chain because its business model is conducive to the mall setting.

The company also plans to open between 60 and 80 new outlets in China to be more economically efficient by cutting operating costs.

TT: What is the company’s strategy for the Taiwanese market?

Hsieh: We aim to refurbish the major 85°C outlets in Taiwan to make them second-generation outlets outfitted with new hardware equipment, a revamped product mix and a new franchise system.

Currently, we sell dozens of types of bread in the 85°C outlets, but only 10 of them are posting strong sales. This led me to consider adjusting the product mix by concentrating production on the popular products, simplifying the product line and raising cost efficiency.

TT: Could you elaborate on the company’s proposed new franchise system?

Hsieh: More than 80 percent of 85°C outlets in Taiwan are licensed stores, meaning that Gourmet Master only only plays the role of manufacturer.

However, we want to ensure a high standard of hardware and software qualities in each store from this year, in line with the plan to upgrade the major outlets.

Therefore, the company may change its current license chain system to a franchise chain model, which would give us more managerial power over the outlets.

TT: Will Gourmet Master develop more brands in the future?

Hsieh: Definitely, the company aims to be a food group with multiple brands in the future, but this will not be the main mission for the company in the short term.

As for the brands currently operated by Gourmet Master, we are ready to launch four or five new outlets this year for both Better Simple and Top One Pot.